You can be sanctioned for lying to a court or from failing to disclose key authorities. That’s obvious. But two recent courts remind the bar that appellate sanctions may be imposed for making bad arguments. One of those cases imposed a whopping $107,000 in appellate sanctions.
The other court did not issue sanctions, but signaled to attorneys who make poor arguments and avoid authorities harmful to their cases may be subject to sanctions.
The court published its stern admonition to the appellant in Shiheiber v. JPMorgan Chase Bank (D1d2 Jul. 26, 2022) No. A160188, as a warning to other attorneys against “clog[ging] our appellate docket” with meritless appeals. Though the court did not issue sanctions, the court noted this was because the respondent did not file a motion for sanctions.
This appeal arose from an award of sanctions under Code of Civil Procedure section 575.2 for the plaintiff’s failure to comply with local rules: here, meeting various pre-trial filing deadlines, such as motions in limine and trial exhibits. The indulgent trial court awarded just $950, markedly reducing the requested $25,000 and keeping the amount under the trigger to report to the State Bar.
But the plaintiff appealed anyway. The court issued a lengthy opinion thoroughly analyzing the statutory structure. The court held that sanctions under section 575.2 does encompass failures to meet pre-trial filing deadlines, and does not require a finding of bad faith.
The court went on to note that the plaintiff’s briefing was substandard. Specifically, the plaintiff did not address a case directly on point; the plaintiff “makes no attempt at any valid exercise in statutory interpretation”; the plaintiff “does not engage at all with the statutory text”; the plaintiff “provides no pertinent legal authority, and relies on inaccurate citations to the California Rules of Court, an irrelevant statute and a bad misreading of irrelevant caselaw”; and the plaintiff “provided us virtually no assistance in reaching our decision.” The court reminded counsel about her duty of candor under rule 3.3 of the Rules of Professional Conduct. And the court characterized plaintiff’s appellate representation as “ultimately empty advocacy.”
The court went on to make a policy observation:
“There are presumptively innocent individuals-who could be any one of us-who have been incarcerated for crimes they say they did not commit, because of errors in the conduct of their prosecution. There are parents-who could be any one of us-who have been separated from their children, because of errors in the application of our juvenile dependency laws. There are children-who could be any one of ours-who, often against the backdrop of difficult life circumstances, have made errors of judgment that have brought them to the attention of our juvenile delinquency courts, sometimes resulting in the imposition of terms of rehabilitation that may be unwarranted, excessive or unduly harsh. We could go on. When counsel files an appellate brief in a civil case such as this that is so utterly lacking in content sufficient to persuade us of the claims they raise on appeal-by presenting arguments in conclusory fashion, failing to engage in any meaningful analysis, citing no potentially relevant authorities and failing to address authorities that plainly are relevant-it not only dooms their client's appeal. It also clogs our appellate docket and inhibits our ability to timely review and decide other cases, including those involving interests of the utmost personal urgency and importance.”
The court did not award sanctions, noting the respondent had not moved for sanctions. (But the court also cited Cal. Rules of Court, rule 8.276(c)-(e), which empowers the court to issue sanctions on its own motion.) But the court concluded with this parting warning:
“We publish this opinion to make clear that, in the future, an appellate argument such as this that is so lacking in even potentially persuasive value will indeed carry the possibility of sanctions as a frivolous appeal.”
The appellant was hit with a whoping $107,000 in sanctions in Pop Top Corp. v. Rakuten Kobo Inc. (Fed. Cir. July 14, 2022) No. 2021-2174, so it deserves mention even though it is from the Federal Circuit. The defendant, Kobo, obtained summary judgment of plaintiff Pop Top’s patent-infringement claim. Pop Top holds a patent over text-highlighting code in ebooks. Pop Top claimed its patent covered Kobo’s ebooks, because they have text-highlighting capability, and they have code.
But, Kobo showed, their text-higlighting is handled by code in their app, not in the ebooks themselves, so it’s outside the scope of the patent. The trial court agreed, and granted summary judgment to Kobo.
Pop Top appealed, but never addressed Kobo’s argument.
Under Federal Rule of Appellate Procedure 38, a federal court of appeal may "award just damages and single or double costs to the appellee" if we determine that an appeal is frivolous. The courts have a "longstanding policy of enforcing Rule 38 vigorously." Walker v. Health Int'l Corp., 845 F.3d 1148, 1157 (Fed. Cir. 2017). An appeal is frivolous as filed when "the judgment by the tribunal below was so plainly correct and the legal authority contrary to appellant's position so clear that there really is no appealable issue." State Indus., Inc. v. Mor-Flo Indus., Inc., 948 F.2d 1573, 1578 (Fed. Cir. 1991). An appeal is frivolous as argued when the appellant engages in misconduct in arguing the appeal. Id.
Here, Pop Top "blatantly misconstrue[d] Kobo's position" in arguing that the parties disputed the scope of the patent. In fact, Kobo’s position was that, even under Pop Top’s construction, there was no infringement. Pop Top's misrepresentation of Kobo's position warranted sanctions. See Mor-Flo Indus., 948 F.2d at 1579 (holding appeal frivolous as argued where appellant "manufactured arguments in support of reversal by distorting the record").
The court awarded sanctions totaling over $107,000.
Judge Newman dissented from the sanctions award. While agreeing the appeal lacked merit, Judge Newman stressed that sanctions for raising unmeritorious arguments implicated the rights to due process and appellate review. See Beghin-Say Int'l Inc. v. Ole-Bendt Rasmussen, 733 F.2d 1568, 1573 (Fed. Cir. 1984) (declining to award sanctions despite "a total absence of merit" in the appellant's arguments).
This is why, normally, sanctions are not awarded merely “’simply because the appellant has a weak case.’ The right of appellate review applies even for weak cases. Biodex Corp. v. Loredan Biomedical, Inc., 946 F.2d 850, 863 (Fed. Cir. 1991) ("As we have repeatedly noted, '[a]n appeal having a small chance for success is not for that reason alone frivolous' and thus deserving of sanctions." (quoting Finch v. Hughes Aircraft Co., 926 F.2d 1574, 1578 (Fed. Cir. 1991)).”
Judge Newman also noted precedent reversing sanctions where the appellant's arguments could "be said to fall just within the ragged edge of the penumbra surrounding legitimate advocacy." Refac Int'l Ltd. v. IBM, 798 F.2d 459, 460 (Fed. Cir. 1986). "The line between the tenuously arguable and the frivolous can be an uncertain one, and sanctions should not be imposed so freely as to make parties with legitimately appealable issues hesitant to come before an appellate court." Finch, 926 F.2d at 1578. Too-easy sanctions can have “an undue chilling effect” on the right to appellate review. Id.
Judge Newman closed with this note: “Litigation by its nature reflects the spin of advocacy, and the right of appellate review is a safeguard to the rule of law. The judicial burden of reviewing a weak appeal or receiving one-sided argumentation does not warrant the sanction of award of attorneys' fees.”
Juxtapose the policy observations in Shiheiber with Judge Newman’s due-process observations in Pop Top. After reading Judge Newman’s dissent, the parting observations in Shiheiber no longer sit right with me.
The court is right to concern itself with the existence of important cases needing its attention. There are always more important cases. But this should not be taken to suggest that cases that do not involve what the court calls “the utmost personal urgency and importance” deserve lesser treatment. That is what Shiheiber’s comments suggest to me: that the court sees cases as coming in different tiers. And if your case does not involve utmost personal urgency and importance, then you may be at greater risk of testing the court’s patience.
The court’s frustration with meritless arguments and substandard advocacy is justified. But the courts should direct their frustration at counsel’s lack of diligence, without suggesting comparisons to other types of cases in the court’s docket.
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes a newsletter of appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at firstname.lastname@example.org or (714) 641-1232.
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